BIG CHANGES IN SMALL PLACES

In Business, September-October, Vol. 29, No. 5, p. 14

A partner in the growing national movement of community greening, the Rural Community Assistance Corporation funds programs to guide constructive projects.

Ellen Drew, Dave Conine and Kristin Middaugh

LARGE amounts of our heartland infrastructure is overburdened, aging and unable to accommodate much-needed economic growth and business expansion. This is particularly true when it comes to funding new water and wastewater facilities. In the West, the Rural Community Assistance Corporation (RCAC) provides training, technical assistance and loans to assist rural areas with innovative solutions.
RCAC is based in West Sacramento, California, with more than 35 field offices located throughout its 13 Western state region. The organization's simple mission in 1979, when RCAC became one of six federally funded regional programs, is to operate rural water and wastewater assistance programs. Throughout RCAC's nearly 30-year history, changing needs have served to dictate new and innovative programs that have integrated seamlessly into the organization's overall work.
Water and waste in the West is a wild, unfolding story of climatic change, drought, fires, oil and gas production, increasing transportation charges and populations that alternately boom and bust. Most current infrastructure was built 40 to 60 years ago, and much of it is in desperate need of upgrades or replacement. Repairs are projected by EPA to cost between $300 to $500 billion before 2020 for water and wastewater alone. Today's small communities can be looking at millions of dollars in loans to upgrade or replace their water, wastewater and solid waste systems. Additionally, regulatory requirements for maintaining standards are often very costly to remain in compliance with both federal and state standards.
RCAC focuses on three areas to help small communities: Technical - staffing, operational and basic infrastructure of water and waste systems; Managerial - managing systems that include volunteer board members, city and town council and staff that assist boards; and Financial - utility financial management.
In 2006, RCAC helped 443 rural communities build, improve, manage, operate, or finance drinking water, wastewater or solid waste systems. In the same year, RCAC helped rural communities access over $24 million in grants and loans and provided more than 2,800 people with customized, on-site technical assistance and more than 200 workshops.
As with other environmental services, RCAC's solid waste efforts have included diverse projects including assisting the Kuha'o Business Center on the island of Moloka'i, Hawaii to stimulate creation of entrepreneurial businesses using recycled materials as feedstock; and working with the Blue Mountain Resource and Conservation District to develop a biomass project for the Fuels for Schools program in Dayton, Washington.

LOAN FUND AND NEW FACILITIES
RCAC's $65 million Loan Fund provides loans to small, rural communities and other nonprofit organizations. In 1996, the U.S. Treasury certified RCAC as a Community Development Financial Institution (CDFI). Among other financial products, RCAC provides short-term and interim financing for a variety of purposes including water and wastewater treatment facilities, community facilities and public buildings of all kinds.
RCAC operates both a Tribal Circuit Rider Program and a Circuit Rider Program specific to Hawaii. In both instances, the goal is the same: to provide public health protection through capacity development of small, public water and wastewater entities, often located in isolated regions. RCAC serves over 100 tribal communities per year.
RCAC is a proud partner in the growing national movement of community greening and sustainability. As a leader in rural development in the West, RCAC's green services help communities realize a future where healthy communities, a sustainable economy and responsible stewardship of the environment can coexist. Projects include housing, water, wastewater, solid waste, renewable energy and others.
As RCAC sees it, affordable housing projects naturally lend themselves to “greening” and sustainability. RCAC works to incorporate and promote sustainable practices in the construction of buildings, infrastructure and in fostering healthier solutions for residents and the environment. These practices include the use of renewable energy, energy efficiency, water conservation, environmentally sensitive site planning, efficient building materials and attention to indoor environmental quality.
RCAC's “Green Team” guides green building, composting, pollution prevention, recycling and 'greening your infrastructure projects both internally and externally.' The team brings together staff members from all disciplines in the organization, including Environmental, Loan and Housing divisions.
RCAC's green projects have been both innovative and successful. In Moab, Utah, RCAC is working with Grand County and the City of Moab to develop an affordable housing plan. The plan will include an emphasis on site planning and building practices that help keep housing affordable by conserving energy and minimizing utility costs.
The Enterprise Foundation has registered a number of RCAC staff as Green Communities Design Charrette facilitators. In 2007, RCAC led a successful green design Charrette for CARE Housing in Fort Collins, Colorado for the Provincetown Community, a large multifamily housing community to be built under the Enterprise Green Communities Program. This project should double the minimum green building standards established by Enterprise, and may qualify for LEED certification.
In Oak Creek, Colorado, RCAC is monitoring the energy usage of two high performance passive-solar strawbale homes, compared with a conventionally built frame home. The study, designed to document real energy performance, began on April 1st, 2007 and will be completed one year later.
RCAC assistance has resulted in residents of Costilla County, Colorado successfully developing a canola oil biodiesel plant. Initially RCAC services were requested to facilitate a session for Costilla County Commissioners and citizens to identify, agree upon and prioritize strategic goals. One of those goals was the development of alternative energies. The project cost $400,000, with a dual production train plant, capable of producing 400 gallons per day. The plant would require 1,000 acres of canola fields to be able to produce enough oil for a year's production; Costilla County is at an elevation of 8,000 feet, which creates ideal temperatures for canola crops. This particular biodiesel process produces left over cakes of pressed canola seed, which can then be fed directly to livestock, and is high in protein and fat.
RCAC has worked with the Blue Mountain Resource and Conservation District to develop a biomass project for the Fuels for Schools program in Dayton, Washington through a USDA Solid Waste Management grant. RCAC researched funding sources and permitting requirements for the project and will complete a report to allow decision makers to review costs, permitting and capacity issues. Under this grant, RCAC also worked with the town of Garfield, Washington to apply for coverage under the State General Permit for Biosolids Management. RCAC is researching strategies for both the towns of Garfield and Endicott for possible composting of biosolids and yard waste. A possible partnership may be developed through the Fuels for Schools project for small scale composting in rural communities, one of the focuses in this solid waste grant.
In Kodiak, Alaska, RCAC assisted Threshold Recycling to secure grants to upgrade the organization's recycling equipment, as well as to purchase the facility. In 2006 Threshold recycled over 1,500,000 pounds of material from a community of only about 8,200 people. Threshold has been recognized in the state as one of the foremost employers of disabled workers. Currently, RCAC is working with Threshold to improve their recycling process and increase their public outreach and education efforts. In an effort to increase the amount of material diverted from the landfill, RCAC and Threshold are exploring the feasibility of implementing a composting project to compost organic waste and biosolids. Composting combined with recycling would lead to the diversion of over 50 percent of the waste stream.
In Somerton, Arizona, RCAC is working with four communities to develop an in-vessel composting plant that incorporates both solid waste and wastewater. The Bio-Degeneration project is a three phase project that, once completed, will reduce MSW entering the landfill from 67,000 pounds per year to 11,000 pounds per year (about 17-20 percent will still enter the landfill). All bio-solids from the communities will be converted into compost, which is estimated to be 163,600 pounds per day. As part of looking at itself as a total green build, the facility will generate all of its own electricity through solar and wind, and use electric vehicles for activities within a 100 mile radius.
Economic Development Assistance is one of the Comprehensive Community Development areas of focus. A small group of well-trained RCAC staff is helping small communities improve struggling economies, reduce out-migration, address decline of natural resource-based industries, respond to outside development pressures and build on past successes.
With an already vast amount of experience, knowledge, skilled personnel and vision, RCAC leaders and staff view the future of the rural U.S. much as Woodrow Wilson did: “America is not anything if it consists of each of us. It is something only if it consists of all of us.”

The authors work for the Rural Community Assistance Corporation, which is based in West Sacramento, California. Ellen Drew works from the Santa Fe, New Mexico office (edrew@rcac.org); Dave Conine works from the Salt Lake City office (dconine@rcac.org); and Kristin Middaugh is from the West Sacramento headquarters (kmiddaugh@rcac.org).

COLORADO COUNTY DEVELOPS BIODIESEL PLANT

A largely poor, struggling rural town develops green energy through an incredible process that took six years, and resulted in a successful biodiesel plant.

Jay Mashburn

PPRIVATE SECTOR capital is difficult to attract in rural Costilla County, Colorado - especially with a project that has a number of unknowns, plenty of risk, and modest to moderate profit potential.
According to the 2000 census, Costilla County's median household income is $19,531. The population of 3,663 is 67 percent Hispanic, and more than 20 percent of the county's families fall below poverty level.
So it is amazing that Costilla County this spring began operating a new, cutting edge, biodiesel plant, which was conceived six years ago, but the plant took this long to develop. It is located in south-central Colorado, in the very small town of Mesita, just nine miles north of the New Mexico border. Costilla County is sparsely populated with a mostly agricultural economy. This predominantly Hispanic area of Colorado has roots back to the state's first settlers, who emigrated from Mexico. The county seat is San Luis, Colorado's oldest town.
The Rural Community Assistance Corporation (RCAC) has provided technical assistance to Costilla County to address various community issues for at least 10 years. In 2001, RCAC received funds to develop a partner community program to provide holistic and comprehensive services in select communities, and Costilla County was identified as a partner community. RCAC first organized and conducted a prioritization needs forum. Funders, local elected officials and interested citizens, especially those connected with local groups, such as churches and nonprofit organizations, participated.
The forum identified 12 top priorities and biodiesel was one of the 12. Community leaders looked into alternative energy options that could bridge their strong agricultural past to sustainable future economic development. Biodiesel was identified as one of the most promising energy sources because of the county's abundant use of diesel fuel and the success of oilseed crops first tested in the area in the mid-1990s. RCAC helped find funding from USDA Rural Development to support developing a biodiesel plant.
The Costilla County commissioners launched the biodiesel project in 2002. The idea was to create a successfully operating community-scale facility to demonstrate biodiesel feasibility to the private sector. County Commissioner Joe Gallegos and Dan Quintana, a retired chemist, created a concept, project scope and conducted design research. Costilla County successfully requested financial assistance from USDA Rural Development in 2004. The project price tag was $400,000. A visit to the Iowa State University biodiesel demonstration plant in Ames confirmed that the project was moving in the right direction. The County Commissioners used a portion of land that they already owned, on which to build the biodiesel plant. Project construction started in early 2004. When the project began, most residents had never heard of biodiesel. Public outreach and education began with defining and explaining the concept. It took time and energy to make residents comfortable with the idea of powering vehicles with crushed seeds.
The project ran into early resistance during the local planning and zoning application process, which caused a half-year delay. The resistance originated from some residents' belief that local government should not be involved in economic development because it is a solely private sector activity. “If biodiesel is a good idea, then a private company will come and do it,” said one planning and zoning board member. “The project's viability was much harder to argue, back then when diesel fuel was cheap and had been cheap for as long as people could remember,” said Project Manager Ben Doon.
Untaxed petroleum diesel was selling for about $1 per gallon in early 2003. The project payback did pencil out, but the fuel price increases during the past couple of years have made this project even more appealing. Current fuel prices and future predictions have shifted the balance in biodiesel's cost benefit ratio.

CHALLENGES TO SUCCESS
Costilla County's community-scale biodiesel production is 400 gallons per day, which is much smaller than commercial plants. Commercial plants tend to cost millions of dollars and produce millions of gallons of biodiesel per year. This size provides them with economy of scale on everything from labor, to developing needed technology, to selling by-products. Many large-scale options and solutions were not available for a community-scale project. For example, Costilla County was forced to shop internationally to find reliable appropriately-sized processing equipment. Biodiesel equipment or equipment that could be used to produce vegetable oil from oil seeds had to be imported from far flung places such as India, China and South America.
Doon said, “We were the first in our region of the state to begin working with smaller scale commercial biodiesel production.” Facility design professionals from Denver lacked biodiesel hands-on experience and knowledge specific to the agriculture sector. The project engineering firm first took a very conservative approach to categorizing the plant's explosion zones. This approach would have made the project much more expensive and somewhat less functional. It took extra research time and effort to convince designers to use a more balanced approach.
The biodiesel processing technology available was changing so fast during the project design and construction phases that it made decisions even more difficult. For example, the project went through four iterations of weighing benefits and costs and then deciding upon a biodiesel cleaning technology. At first, water washing looked most feasible. However, new ion exchange technology resolved many of the water washing difficulties. Then, appropriately- sized centrifuges became available that were much more affordable to purchase and operate. The Costilla County plant is now using a filter and centrifuge to reach the American quality standard specifications for biodiesel.
RCAC was helpful in this process. The organization provided a good deal of technical assistance to the project, mostly in the form of advice and encouragement from its two professional engineers working in Colorado, this article's author (Jay Mashburn) and William Hogrewe, RCAC rural development specialist.
Costilla County has some factors that make biodiesel a good fit. The county is at an elevation of 8,000 feet, and the high elevation creates temperatures ideal for canola crops. The word “canola” is derived from “Canadian oil, low acid,” according to Wikipedia. “Canola is a rape plant of an improved variety having seeds that are low in erucic acid and the source of canola oil,” per the Webster online dictionary. Canola, soy beans and sunflowers all work well for biodiesel stock. However, canola produces nearly twice as much oil as the common biodiesel feedstock -- soybeans.
The biodiesel demand for edible oil is not forcing out other crops or reducing food production. There are 450,000 acres of crops harvested each year in the San Luis Valley. The Costilla County biodiesel plant requires about 1,000 acres of land to produce enough canola for a year's production. In fact, the biodiesel project provides education and outreach to farmers on cultivating canola for both food and fuel. Canola is not always a primary crop, but it is an excellent rotation crop for farmers.
The biodiesel process produces cakes of pressed canola seed. The seed cakes can be fed directly to livestock and are high in protein and fat. The San Luis Valley has a long tradition of small, family-run ranches and livestock operations. Area cattlemen and women purchase the seed cake directly from the biodiesel plant in one or two ton quantities. The biodiesel plant staff members package the canola cakes in 100 pound sacks and sell them directly to the residents. This helps the biodiesel plant get a better price for the feed meal and saves the cattle grower money with a locally available protein feed that is below retail prices.
The project provides employment for four people. Some of the work is only seasonal with the seed crop. In a county with high unemployment though, this is more than just a side benefit. Doing something environmentally friendly is much easier when it also creates a tangible benefit.
The Costilla County commissioners' vision, commitment and hard work were significant factors in the project success. The commissioners provided real leadership each step of the project, moving the vision forward to gain public support and assist with design, construction and commissioning.
In addition, Quintana's assistance, with his chemist and engineering management experience, was substantial. If Costilla County had needed to find and retain outside professionals with Quintana's skills, it would have greatly slowed progress and increased the headaches and costs for the county.
The biodiesel plant is a welcome neighbor in the San Luis Valley because of a strong farming and ranching tradition. The community impacts are limited to some additional farm truck traffic that hauls canola seed to Mesita, and the visual impact of the plant's seed storage silos and bins.
Doon said, “Most folks here welcome the sight of new grain silos as a good sign.”

TECHNOLOGY FOR PLANT
The Costilla County biodiesel plant produces biodiesel in batches. Large commercial facilities use a continuous flow process where things are always going in and coming out of the plant. The Costilla County plant is much more like your local baker, cooking in batches. The plant is able to produce four 100 gallon batches each day. However, the plant is not yet operating at 100 percent capacity as operators work on operation efficiency. The biodiesel produced can be used straight in vehicles during the summer months as B100 grade.
“Much of the world uses a system known as the 'B' factor to state the amount of biodiesel in any fuel mix,” according to Wikipedia. During cold weather, the biodiesel is blended on-site with petroleum diesel to lower the temperature at which it congeals. Once biodiesel and petroleum diesel are thoroughly blended, they will stay in suspension and require no additional mixing or special handling.

Jay Mashburn is a rural development specialist with the Rural Community Assistance Corporation.

Copyright 2007, The JG Press, Inc.